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Edinburgh's Chamber of
Commerce reports the Scottish Capital has reached 2nd place behind only
York in the Demos-PwC's Good Growth for Cities' Annual Index - up seven
places on 2024.
The city scored highly for its skills, work-life balance and jobs but
needs to do more to ensure the lasting fortunes of new businesses plus
achieve improvements in the health and housing sectors.
Over the next year the launch of a series of targeted strategies promise
to improve how growth is delivered across Edinburgh and who benefits
from such moves.
Edinburgh Castle in all its spendour with the Balmoral in foreground
PWC labels the index as 'Smarter Choices, Better Outcomes' claiming
local economies across the UK are at a turning point: there is a renewed
focus on what it describes as 'place-based growth' to create fresh
impetus for action.
'Progress depends on clear, strategic choices,' where prioritising the
foundations of thriving communities and businesses represent the key.
Along with a focus on local strengths with tangible economic potential
outcomes people can both see and feel.
Overtaking London
Edinburgh hit a new milestone in June 2025 overtaking London in terms of
GDP per head for the first time. This growth reflects a mix of
long-established strengths in financial services and higher education,
alongside relatively new specialisms including life sciences and
technology.
The city's growth, a strong research base and skilled workforce has
attracted global interest with 27 foreign direct investment projects
secured over the past year, PwC reports.
Yet this kind of economic growth and investment doesn't always translate
into tangible benefits for the public but there are signs Edinburgh's
residents do stand to gain from its impact.
PwC confirms: 'The city climbed to second place in our index this year -
scoring well across a range of indicators including youth and adult
skills, high streets and shops and work-life balance.'
Such results suggest Edinburgh's economic expansion IS leading to
improvements in quality of life and opportunity but lower scores in home
ownership and income do indicate not all residents are seeing these
benefits.
Other Significant Factors
The Capital's thriving tourism industry is another area where the City
is working to spread the benefits of growth more fairly. The Edinburgh
Fringe - described as the world's largest performance art festival -
draws millions of visitors to the city every year.
It creates jobs, drives spending and brings global attention to the city
but despite significant economic activity generated, much of those
financial benefits are channelled through national tax systems.
Also, residents experience the annual disruption of the festivals
without seeing tangible improvements to local services and
infrastructure, the index points out.
Significant numbers of shows are free or pay what you can afford
New Visitor Levy
PwC says a new visitor levy is set to change that - from 24 July 2026
visitors will pay a 5 per cent charge per night on paid accommodation
with the levy applying across the entire local authority area 365 nights
per year and projected to raise up to 50 million pounds annually by
2028/29.
It's the first time Edinburgh will have a dedicated income stream tied
directly to visitor numbers. The plan is it will allow the City Council
to reinvest in services and infrastructure supporting both residents and
the visitor experience.
Proposed uses include affordable housing, with maintenance plus support
for the culture and wider visitor economic sector. The initiative along
with wider action to address inequality point to a fairer future where
benefits of growth are felt more broadly.
Bottom Line?
A long-time Edinburgh resident and having also lived and worked
journalistically in York, it is completely understandable how two such
world-renowned cities would be placed where they stand - each offer up
an abundance of attractions but cannot rest on their laurels, as this
index shows. Time will tell if the new visitor levy tilts Scotland's
Capital upwards just that single step to top spot... |
